Will Baby Boomers Help or Hurt Funeral Industry?
At the Cannes Film Festival recently, director Woody Allen said about death, “I’m strongly against it.”
No doubt he was serious, but the former stand-up comedian was also serious about promoting his latest film, You Will Meet a Tall Dark Stranger?the “tall dark stranger” being a euphemism for death.
For those in the funeral industry, death, or lack thereof, has been no laughing matter for almost a decade. Funerals and cremations are at a 20-year low.
About a decade ago, the industry was handling three million deaths a year. Now that number is a third less.
With an inherent gallows-humor bent, it’s not surprising that lots of possible reasons have been circulating within the funeral industry about slow business. Among them are alien abductions, body snatchers, secret and private home funerals and burials, but none seemed to satisfy or be tenable.
What adds insult to injury is that the industry geared up for lots of new business, following advice from a noted demographer and expert on aging 15 years ago. The demographer predicted that members of the huge Baby Boomer generation would start dying en masse in 2000.
That ?good? news coursed through the industry like wild fire, and funeral professionals braced for the predicted explosive demand. The mom-and-pop funeral homes made substantial capital improvements, the big boys bought each other up with a vengeance and Wall Street geared up for a killing, so to speak.
The year 2000 came and went. The year 2005 passed. Now it?s 2010, and still the vast majority of the Boomers are alive and kicking.
People in the industry were asking “why aren’t the Boomers dying?” Didn?t they know that the industry was counting on them? The Boomers weren?t dying, because the esteemed demographer was 20 years off. That is correct, 20 years off. That?s a very big mistake in the field of demography.
For years, we have been hearing about the ?graying of America??the time when an overwhelming majority of the people in the United States will be elderly. It is unclear when the phrase was coined, but the popular belief is that it came into usage about 15 years ago when someone of authority had the startling revelation that the Baby Boomers were no longer kids and that the fastest growing segment of our population were elderly people in their eighties. The problem is that these two facts had nothing to do with each other.
Naturally, it?s true the Boomers are aging, but they were nowhere near being elderly, not by a long shot. In fact, 15 years ago, when the prediction about their imminent death was made, Baby Boomers ranged in age from about 31 to 50.
It was also true that one of the fastest growing segments of our population at that time were folks 85-years-old-plus. Those Americans were part of the enormous G.I. Generation, the Boomer?s parents, born 1905 to 1924, who, at that time, were aged 71 to 90. Remember also, that the live birth count of the G.I. Generation grew by millions due to the influx of European immigrants.
What everyone also overlooked was that the so-called Silent Generation, born between 1925 and 1944, the smallest generation of the last 100 years?and obviously pretty darn quiet. Plus, there was little or no immigration during the silents? birth years.
By virtue of their small size, the Silent Generation nearly crippled the funeral industry, because it simply did not have the critical mass to utilize the infrastructure built up in anticipation of the aging and dying of the Boomers. The Silent Generation, now 66 to 85 years old, now occupies the elderly and dying segment of the United States population.
The graying of America myth cost the funeral industry billions. That will change in five to 10 years, when the Boomers finally fulfill the graying myth, by becoming elderly and dying right on time?but 20 years later than the industry expected.
Generations have been defined in 20-year increments for thousands of years. It makes them easy to figure out. A generation is roughly the amount of time it takes one generation to begin to produce another.
We have five distinct generations in the United States today shown on the live birth chart below.
Most Americans die in their seventies?women between 76 and 78 and men between 72 and 74.
At first look, it would then follow that if the oldest Baby Boomers are now only 65 years old, the funeral industry is certainly going to have to wait a few years for this crush of new customers.
The logic and math work, but there are a couple of other factors at work here. One is the size of the Boomer generation and the other is their overall health.
By virtue of the Boomers? sheer numbers, millions have died already and many will die before reaching the average mortality age. The funeral industry is already feeling this impact.
The health of the Boomer generation is another wild card. Obesity is epidemic, for one. And for those Boomers who abused drugs and alcohol in the sixties and seventies, it could cause premature death.
As if the beleaguered funeral industry didn?t have enough problems, will the Boomers change the way funeral services are used? As a generation, Boomers change things?everything. So that?s likely a yes.
So with the Boomers’ history in mind, the following questions come to mind: Will funeral homes remain relevant? How many Boomers will chose to be cremated? Will the somber tones and creepy music of the traditional funeral be replaced with celebration and rock ?n? roll? Will there be religious services? Or, if it?s available, will they buy a funeral kit online or at Wal-Mart [WMT 51.15 -0.22 (-0.43%) ] and handle their own funerals? Will funeral services be cyber rather than in-person? Will the deceased live on as avatars? How will funeral directors communicate with Generation Y kids as they make funeral arrangements for their Boomer parents?
The funeral industry is at a crossroads, with change bearing down on it. The next five years or so will be defining. Demand will most certainly increase and the progressive contingent will prepare, change and dramatically prosper.
Bob Dylan pondered this idea when he penned the lyrics, ?The times, they are a changing?.? And how!
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